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Understanding Changes in the Software & Venture Capital Industries

Both Sides of the Table

In this three-part series I will explore the ways that the Venture Capital industry has changed over the past 5 years that I would argue are a direct result of changes in the software industry, not the other way around. So it’s unsurprising that typical “A rounds&# of venture capital were $5-10 million.

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Want to Know How VC’s Calculate Valuation Differently from Founders?

Both Sides of the Table

Back in 1999 when I first raised venture capital I had zero knowledge of what a fair term sheet looked like or how to value my company. When I went to raise money in 2006 I thought I knew every term in a term sheet but somehow I still got a bit duped by the option pool shuffle. You reap what you sow.

Valuation 405
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Does the Size of a VC Fund Matter?

Both Sides of the Table

This is part of my series on Understanding Venture Capital. In an early stage deal that fund might reserve 2x their initial investment or if it’s a larger round or later stage they might reserve 1x. Tags: Pitching VCs Raising Venture Capital VC Industry.

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YC follows a well trodden path for investment firms: drifts later stage

The Equity Kicker

In the words of an alum from the 2006 cohort: Companies are joining YC at a much later stage. In 2006, getting acquihired by Google for a couple million buckets was considered a fabulous outcome and basically the goal of every company. That relates to a second change he observed: Companies are much more ambitious now.

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Looking for Funds in All the Right Places

Austin Startup

Austin-Based Venture Capital Firms There are a eleven venture capital firms based in Austin that are actively investing today, six of which are first funds. VC Firms Actively investing in Austin Companies Finally, there are a group of venture capital firms that are not based in Austin that are active investors here.

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The Seeds Have Changed: An Epilogue to The New Venture Landscape

K9 Ventures

The Venture Capital industry as a whole does a terrible job of giving things the right name and so we end up keeping the same name, but changing the meaning out from under it. There is an opportunity for LPs to pick the right Pre-Seed stage funds, but I certainly don’t envy their job as it’s not going to be an easy task.

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New money into venture explains ups and downs in the market

The Equity Kicker

I just saw a great presentation from Mark Suster/Upfront Ventures on the State of the Venture Capital in 2016 which explains the discrepancy between the sentiment in the market and the observation that there are lots of funds out there which need to deploy capital.